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Category Archives: Regulation A+

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D.C. Circuit Court of Appeals Upholds Regulation A+

Posted in Accredited Investor Standard, Regulation A+, SEC News

On June 14, 2016, the D.C. Circuit Court of Appeals in Lindeen v. SEC upheld Regulation A+, including the SEC’s definition of “qualified purchaser.”  The decision comes after petitioners William F. Gavin and Monica J. Lindeen, the chief securities regulators for Massachusetts and Montana, respectively, petitioned the court to vacate the SEC’s promulgation of Regulation… Continue Reading

Will Reg A Offerings Flourish in the IPO Downturn?

Posted in IPO On-Ramp, Regulation A+

While the JOBS Act helped spur larger, venture capital- and private equity-backed companies to consider IPOs, it has not served to revive the smaller IPO market. Perhaps the IPO market downturn will cause market participants to consider the merits of a Regulation A+ offering with an exchange listing.  To read this CFO magazine guest article… Continue Reading

NASAA Request for Comment on Statements of Policy

Posted in Regulation A+

For offerings that require state securities registration and review, clients often are concerned about the merit regulation standards. Certain of NASAA’s Statements of Policy, for example, may pose significant issues. From time to time, commentators have requested that a review be undertaken of the following six policies: the Statement of Policy Regarding Promoter’s Equity Investment,… Continue Reading

OTC Markets Group Inc. on Rule 15c2-11, the “Piggyback” Exception and Secondary Trading Markets

Posted in JOBS Act News, Regulation A+, SEC News

OTC Markets Group Inc. (“OTC Markets Group”) operates the OTCQX® Best, OTCQB® Venture and Pink® Open markets for 10,000 securities.  Our wholly-owned subsidiary, OTC Link LLC, operates OTC Link® ATS, an SEC regulated alternative trading system that directly links a diverse network of broker-dealers providing liquidity and execution services. We appreciate Morrison & Foerster raising… Continue Reading

Capital Formation Legislative Update

Posted in Capital Formation, Crowdfunding, Regulation A+, Regulation D

On March 22, 2016, Congressman French Hill introduced a bill, HR 4831, that would amend the 100-holder restriction on S corporations in the limited case of shares acquired through crowdfunded offerings or Regulation A offerings.  The text of the proposed bill is available here: https://hill.house.gov/sites/hill.house.gov/files/wysiwyg_uploaded/HILLAR_027_xml%20-%20S-Corp_0.pdf. On March 23, 2016, Congressman Tom Emmer introduced a bill, HR… Continue Reading

The Decline of the Small IPO

Posted in IPO On-Ramp, Regulation A+

A recent journal article by Prof. Robert Bartlett, III, Prof. Paul Rose, and Prof. Steven Davidoff Solomon (What Happened in 1998? The Demise of the Small IPO and the Investing Preferences of Mutual Funds) suggests that the decline in smaller IPOs resulted in a shift in the investment preferences of mutual funds away from IPOs… Continue Reading

Financial Services Committee Approves Bills Relating to Capital Access

Posted in Capital Formation, EGCs, General Solicitation, Regulation A+

At today’s House Financial Services Committee meeting, ten bills relating to facilitating access to capital and the reduction of regulatory burden on smaller reporting companies were approved.  Among the bills that passed the committee, the following relate to capital formation: HR 4139, The Fostering Innovation Act, passed the committee 42-15.  The bills proposes to extend… Continue Reading

House Financial Services Committee Mark-Up

Posted in EGCs, Regulation A+, Start-Ups

On March 2, 2016, the Financial Services Committee will meet to mark up various proposed bills, including the following that relate to capital formation: HR 4139, The Fostering Innovation Act, which extends the Sarbanes-Oxley 404(b) exemption for EGCs until the earlier of ten years after the EGC’s IPO, the end of the fiscal year in… Continue Reading

IFLR Webinar – The New Dynamic: Exempt Securities Offerings in the United States and Resales of Restricted Securities

Posted in Crowdfunding, Events, IPO On-Ramp, Private Placements, Regulation A+

On February 24, 2016, at 11 a.m. EST, Morrison & Foerster Partners David Lynn and Anna Pinedo will be joined by Annemarie Tierney, NASDAQ Private Market, in hosting an IFLR webinar entitled “The New Dynamic: Exempt Securities Offerings in the United States and Resales of Restricted Securities.” The JOBS Act and more recently the FAST… Continue Reading

NASAA Requests Comments on Proposed Rule and Notice Form for Tier 2 Regulation A Offerings

Posted in Regulation A+

On January 27, 2016, the Corporation Finance Section of the North American Securities Administrators Association (NASAA) requested comments on a proposed model rule and uniform notice filing form aimed at simplifying the state notification requirements for Regulation A Tier 2 offerings.  One of the most significant concerns regarding the proposed amendments to Regulation A was… Continue Reading

ALI CLE Seminar: Regulation D Offerings and Private Placements…Plus New Options for Exempt Offerings

Posted in Crowdfunding, Events, Private Placements, Regulation A+, Regulation D, Rule 144A, Rule 506

On Thursday, March 10, Friday, March 11, and Saturday, March 12, 2016, Morrison & Foerster Partner Marty Dunn will speak at the American Law Institute’s “Regulation D Offerings and Private Placements…Plus New Options for Exempt Offerings” conference in Scottsdale, Arizona. Mr. Dunn will participate in several panels, including: “Conceptual, Statutory, and Regulatory Background and Structure;”… Continue Reading

Complimentary Teleconference: Too Many Exempt Offering Choices?

Posted in Crowdfunding, Events, IPO On-Ramp, Regulation A+, Rule 506

On November 16, 2015 at 12:00 p.m. EST, Morrison & Foerster Partners David Lynn and Anna Pinedo will lead a teleconference on exempt offering choices available to issuers. Now that the final Regulation Crowdfunding has been released, all of the new offering formats contemplated by the JOBS Act will be available to issuers. Of course,… Continue Reading

PLI Seminar: Understanding the Securities Laws Fall 2015

Posted in Crowdfunding, Events, Private Placements, Regulation A+, Regulation D, Rule 144A

PLI’s Understanding the Securities Laws Fall 2015 conference on December 17-18, 2015, will provide an overview and discussion of the basic aspects of the U.S. federal securities laws by leading in-house and law firm practitioners and key SEC representatives. Emphasis will be placed on the interplay among the Securities Act of 1933, the Securities Exchange… Continue Reading

Market Update

Posted in Regulation A+, Rule 506

At today’s Practising Law Institute conference on Private Placements and Hybrid Securities Offerings program, a representative of the SEC Staff shared some statistics on Rule 506 offerings.  Since the September 2013 effective date of the amended Rule 506 rules, based solely on Form D filings there have been approximately 40,000 Rule 506(b) offerings, raising approximately… Continue Reading

PLI Seminar: Private Placements and Hybrid Securities Offerings 2015

Posted in Events, Private Placements, Regulation A+, Regulation D, Rule 144A

PLI’s Private Placements and Hybrid Securities Offerings 2015 conference on October 26-27, 2015, presents an expert faculty of leading practitioners and regulators as they discuss and analyze the changing regulatory framework and market for private offerings.  They will address the changes to private and exempt offerings brought about by the JOBS Act, including matchmaking platforms,… Continue Reading

Updated OTCQX and OTCQB application guides for Reg A+ Issuers

Posted in Regulation A+, Venture Exchanges

In response to feedback from issuers, the OTC Markets Group has released updated guides outlining the application process to join their OTCQX Best Market and OTCQB Venture Market trading platforms for companies conducting offerings under Tier 2 of Regulation A+.  The OTCQX Best Market is for established, growth and global companies that meet high financial… Continue Reading

Unlawful Crowdfunding? — SEC Institutes Public Administrative and Cease-and-Desist Proceeding Against Unregistered Broker-Dealer

Posted in Crowdfunding, Regulation A+, SEC News

In a proceeding on September 28th, the SEC ordered a public hearing to be held before an Administrative Law Judge within the next two months.  Further, the SEC ordered the Respondent and two companies under his control, to cease and desist from any engaging in any unlicensed and/or criminal acts of securities dealing. The Respondent… Continue Reading

No Portal Necessary

Posted in Capital Formation, Regulation A+

With increasing frequency, we are asked whether an issuer that is considering a Regulation A offering is required to engage or use the services of a funding portal. In short, NO. A funding portal is a new type of financial intermediary that performs certain limited functions in connection with Title III crowdfunded offerings. A funding… Continue Reading

Regulation A Roundup

Posted in Regulation A+

This week marks the three-month anniversary of the effective date of Regulation A.  Of course, given this limited experience, it may be premature to comment on market developments.  Instead, below we summarize significant developments. Small Entity Compliance Guide Immediately prior to the effective date, the Securities and Exchange Commission published this Small Entity Compliance Guide:… Continue Reading

It’s Not Crowdfunding!

Posted in Regulation A+

Since the Regulation A+ effective date last month, a number of websites have emerged that promote “Regulation A+ crowdfunding” contributing even further to the confusion in the market regarding “crowdfunding.” Colloquially perhaps any attempt to raise capital through the use of an internet-based platform may be thought of as crowdfunding; however, to a securities lawyer,… Continue Reading

SEC Guidance on Regulation A+

Posted in Regulation A+, SEC News

The SEC has provided guidance to issuers on Regulation A+ offerings.  You can access the SEC’s Small Entity Compliance Guide here:  http://www.sec.gov/info/smallbus/secg/regulation-a-amendments-secg.shtml. In addition, the SEC Staff has published a number of Compliance and Disclosure Interpretations, which may be accessed here: http://www.sec.gov/divisions/corpfin/guidance/securitiesactrules-interps.htm#182.01. For convenience, we have reprinted below the C&DIs. Section 182. Rules 251 to… Continue Reading

Complimentary Teleconference: Canadian Issuers and Regulation A+

Posted in Events, Regulation A+

On Thursday, June 25, 2015, Morrison & Foerster Partner Anna Pinedo will be joined by Blake, Cassels & Graydon Partner Pamela Hughes to present “Canadian Issues and Regulation A+”.  On June 19, 2015, the Regulation A+ rules adopted by the U.S. Securities and Exchange Commission became effective. Regulation A+ provides an important capital-raising alternative for private… Continue Reading

SEC Denies Motion to Stay Regulation A+

Posted in Regulation A+

On June 5, 2015, Monica J. Lindeen, Montana State Auditor, ex officio Commissioner of Securities and Insurance, filed a motion with the SEC for a stay of the Regulation A+ rules, which are scheduled to become effective this Friday.  In an order issued on July 16, 2015, the Commission denied the Montana motion.  The Commission… Continue Reading